Form 5329: Early Withdrawal Tax Form

Form 5329 reports extra taxes on retirement and tax-favored accounts. A common use is the 10% additional tax on early distributions. An early distribution is money you take from a retirement plan or IRA before age 59½. This page explains Part I for tax year 2025. For the rules on when the 10% tax applies, read the 10% additional tax and its exceptions. IRS: Form 5329 (2025)

You may not need the whole form

The form's first page says that if you only owe the additional 10% tax on the full amount of your early distributions, you may be able to report it directly on Schedule 2 (Form 1040), line 8. You do not have to file Form 5329 in that case. Read the instructions to confirm that you qualify. IRS: Form 5329 (2025), top of page 1

Part I, line by line

Line 1: Enter the early distributions included in your income. Use the taxable amount from your Form 1099-R.
Line 2: Enter the exception number, if one applies, and the amount that is not subject to the extra tax.
Line 3: Subtract line 2 from line 1.
Line 4: Multiply line 3 by 10%. Enter the result on Schedule 2 (Form 1040), line 8.

If part of line 3 came from a SIMPLE IRA and the distribution happened within 2 years after you first joined the SIMPLE IRA plan, the rate is 25%, not 10%. IRS: Instructions for Form 5329 (2025)

Exception codes

Line 2 uses numbers from the instructions. Here are some codes that apply to many people:

01: A plan distribution (not an IRA) after you leave a job in or after the year you reach age 55 (age 50 for qualified public safety employees).
02: Substantially equal periodic payments.
03: Total and permanent disability.
04: Distributions due to death.
05: Plan distributions up to your unreimbursed medical expenses minus 7.5% of your adjusted gross income.
08: IRA distributions for qualified higher education expenses.
09: IRA distributions for a first home, up to $10,000.
19: Qualified birth or adoption distributions, up to $5,000.
20: Distributions due to a terminal illness.

If more than one exception applies, enter 99. The full list has more codes, including some for IRAs only. IRS: Instructions for Form 5329 (2025), exceptions table

Check your Form 1099-R

Box 7 of Form 1099-R shows a distribution code. Some codes mark a payment as early even when it is not. If you were 59½ or older, the instructions say to include that amount on line 2 under exception 12. Check your code before you file. IRS: Instructions for Form 5329 (2025), exception 12

Parts III and IV: excess IRA contributions

Parts III and IV are for excess contributions to traditional and Roth IRAs. The tax on those is 6%, and it is a separate calculation from the early-distribution tax. If you have excess contributions, read the excess IRA contribution page before you fill in those parts. IRS: Form 5329 (2025), Parts III and IV

Steps to follow

Gather every Form 1099-R that shows a distribution in 2025.
Check whether any exception applies to each amount.
Complete Part I. Put the 10% amount on Schedule 2 (Form 1040), line 8.
File Form 5329 with your return if you completed any part of it.

Records to keep

Keep each Form 1099-R and the records for any exception you claim. For a birth or adoption distribution, the instructions say to attach a statement with the child's name, age, and taxpayer identification number. For a terminal illness, keep the physician's certification. IRS: Instructions for Form 5329 (2025), exceptions 19 and 20

Read Form 1099-R basics to learn what each box means. Read Schedule 2 to see where the additional taxes go.

General information, not advice for your situation.

Sources: Sources: IRS, Form 5329 (2025), Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts (https://www.irs.gov/pub/irs-pdf/f5329.pdf); IRS, Instructions for Form 5329 (2025) (https://www.irs.gov/pub/irs-pdf/i5329.pdf) This is general information, not advice about your specific return.

← Back to the blog · Leer en español